SOUTH AMERICA – Grupo Bimbo, the Mexico-based snacks and bakery giant has announced that it has shut the doors of its confectionery business in Uruguay, cutting 62 jobs.
According to the company statement, the move will allow it to “focus on its baking and snacking categories” which is part of Grupo Bimbo’s global strategy to consolidate its leadership in grain-based foods and focus on the baking and snack industries.
The bakery group, which entered the Uruguay market in 2006 with the acquisition of baked goods brand Los Sorchantes, could stop producing Ricard chocolate from the end of the month according to the report.
According to Just Food, Grupo Bimbo’s presence in Uruguay encompasses ten brands including biscuit and bakery brands Tia Rosa and Maestro Cubano.
In addition, sources unveiled that affected employees have reportedly been informed of the decision and local reports suggest the National Organisation of Workers of Dulce, Branches, and Related (Onodra) is representing them.
The announcement comes after the recent declaration by the company that it has registered a lower Q1 profit attributed to a high inflationary environment and even higher commodity prices than last year.
During the financial period, the Mexican bakery giant reported first-quarter sales of 99.6bn pesos (US$5.5bn), representing a rise of 9.9% on a year-on-year basis, but a dip in net majority income by 9.4% at MXN4.05bn.
However, the group remains resilient in the acquisition of the bakery and snacks sectors.
Earlier this month, US-based Natural Bakery was snapped up while in January, Grupo Bimbo went after Vel Pitar in Romania. The company also acquired a UK-headquartered St Pierre Groupe last October.
Grupo’s aggressiveness in investment follows its commitment to spend up to US$2bn on capital investment in 2023 in part to meet the demand for its products.
According to Grupo, the group is focusing on more profitable projects that will not help the top line but will help to be more efficient and have an expansion on their margins.
In Latin America, Grupo Bimbo’s Group returned 9.63bn pesos in net sales ($546.8m) in the opening quarter of 2023, marking an 8.6% year-on-year rise.
The Mexican major’s adjusted EBITDA for the three months to 31 March showed a 35.7% year-on-year spike, reaching 11.037bn pesos.
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